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From Paper To Process

Many business procedures are closely linked to paper documents; improving a process often requires getting control of the documents

Life would have been easier for Mike Coyne if business processes were linked as easily as lengths of pipe. As project manager for the Distribution Engineering Group at Shell Pipeline Company LP, he found that his company's move from a legacy accounting system to SAP--part of a business-process redesign implemented in 2001 with the help of consulting firm Accenture--created confusion about how to requisition materials and services. The system also didn't address project-management needs.

"We went from somewhat organized to really much less efficiency," he says, estimating a 20% to 30% decrease in project performance.

The problem was that the SAP system, which dealt with cost structures and financial modeling, didn't effectively address project-management tasks such as reports generated by engineers in the field. Shell Pipeline is a subsidiary of Shell Oil Products U.S. and is one of the largest pipeline-transportation companies in the country. In essence, documents with critical data--such as X-ray reports of pipe conditions, project cost estimates and reviews, requisitions, and welder-qualification records--needed to be linked for better decision support and regulatory-compliance monitoring.

The answer came from two tech vendors, plus a data-collection and management system developed in-house. The first was Citadon Inc., an ASP that offered Web-based project collaboration and business-process management to Shell and its business-to-business partners. The second was FileNet Inc., a content-management software company, which provided behind-the-firewall document life-cycle management.

The result has been a huge efficiency increase, says Coyne, who adds that his group went from simply getting projects done to more actively managing the scope and cost.

Welcome to business-process management. It's a term that, research firm Gartner notes, has long confused vendors and technology users alike because there aren't standard terms and concepts to frame a discussion of it. Gartner VP and analyst Jim Sinur takes a shot at a broad definition of BPM as "managing work as it flows through an organization." There are dozens of companies selling software and services that fall under the BPM umbrella, many of them with ties to document management. Among the leaders identified by Gartner in a June Research Note are FileNet, Lombardi Software, and Ultimus.

Gartner cites five essentials in a BPM system: graphical tools for analyzing, modeling, and defining processes; an execution engine to maintain status of each process instance or business event; the capacity to adapt to changing requirements; tools to monitor and manage processes; and tools to analyze completed projects.

Boeing Co.'s experience shows why document-management companies established a strong foothold in the BPM market. Boeing's problem was a flood of forms. When the aerospace company merged with McDonnell Douglas Corp. in 1997, it was left with 36,000 employee forms and no sense of which should be used for what actions, says Scott Beckman, systems manager for Boeing Forms Library. Thus the Boeing forms-integration team came to be, to create a Web site where employees could access any form.

About 70% of the company's forms could be translated into electronic versions. Among the processes that benefited was the company's Learning Together Registration program, through which Boeing pays employees to study. Employees used to fill out paper forms and fax them in to participate in the program. Processing took two weeks, with errors and omissions common. Using FileNet's Forms Manager software, Beckman and his group took the task online. Now processing takes 20 minutes.

But change in the workplace never comes easily, especially when it touches a linchpin of bureaucratic process like the paper form. Initially, it was a challenge to get users to accept a new way of doing things, Beckman says. So the team focused on making life easier for form users. "You had to get them something a lot better than what they were used to," he says.

Groups now ask Beckman's team to build forms for their business processes, even for simple activities. "A lot of people want to route things around the company and have them electronically signed," he says. "And they never know who to send [them] to." Now, he says, "they use our electronic form, electronically sign it, put in their information, and then hit send and it goes to the next person."

Paper proved to be a problem for Prince William County, Va., as well-- specifically, personnel action forms. In recent years, the county went from 3,000 to 3,600 employees without adding administrative staff. For the beleaguered human-resources department, the processing, filing, and retrieval of personnel action forms--required to hire or fire a person, or change their benefits--was slow and inefficient, with errors in one in five forms.

Prince William County automated its forms processing using the Ultimus business-process-management suite. As a result, it experienced a decrease in processing time and a reduction in error rates, says Maneesh Gupta, head of the county's information systems division. A return-on-investment analysis from Nucleus Research found the county recouped its investment in 18 months.

Intriguing though such examples may be, much of the adoption of forms-related business-process management probably will be driven by the increasingly difficult challenge of complying with international, federal, state, and local regulations. While BPM may fall short of delivering the fabled paperless office, it could--by controlling the flow of data, improving auditing capabilities, and ensuring corporate transparency--play a part in keeping managers from having to visit a windowless office, and talk to investigators about the shortcomings of their oversight systems. Among the laws that Gartner says most concern IT managers are the Sarbanes-Oxley Act's financial-control reforms and the Health Insurance Portability and Accountability Act, as well as Food and Drug Administration regulations that govern electronic records.

But for toymaker Hasbro Inc., the problem centered on its supply chain and improving how the company communicated with business partners such as suppliers and freight forwarders. It depended on those perennial favorites of phone, fax, and E-mail.

David Adams, business-integration manager at Hasbro

Hasbro improved supply-chain communication, says business-integration manager Adams
To standardize and improve its procurement operations, the company turned to Lombardi Software's TeamWorks. David Adams, business-integration manager at Hasbro, writes via E-mail that many suppliers and logistics providers now manage all their interactions through the Internet, which has improved fulfillment cycles, cut costs, and improved service.

Through automation, integration, and content management, the company has realized greater efficiency and standardization of partner-facing processes, such as competitive bidding. Adams describes how vendors bidding to produce a particular toy, for example, now do so through a standard Web form generated by TeamWorks. As a result, predetermined business rules, such as requiring delivery on a certain date, can be clearly communicated and enforced. In terms of ROI, Adams says transactional volume in the company's Hong Kong office, for instance, has increased some 200%, thanks in large part to the efficiency of working entirely online.

Illustration by John Ueland

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